Major Labels Accused Of $6 Billion Worth Of Copyright Infringement In Canada

from the oops dept

The major labels and their friends like to throw around huge numbers of "damages" when it comes to copyright infringement. But how about when they're on the receiving end of a copyright infringement lawsuit. Up in Canada, there's a class action lawsuit against the Canadian divisions of all of the major record labels, suggesting that the labels have infringed on the copyrights of artists to the tune of $6 billion (Updated: the original math was off, it's actually $6 billion, not $60). As Michael Geist explains:

The claims arise from a longstanding practice of the recording industry in Canada, described in the lawsuit as "exploit now, pay later if at all." It involves the use of works that are often included in compilation CDs (ie. the top dance tracks of 2009) or live recordings. The record labels create, press, distribute, and sell the CDs, but do not obtain the necessary copyright licences.

Instead, the names of the songs on the CDs are placed on a "pending list", which signifies that approval and payment is pending. The pending list dates back to the late 1980s, when Canada changed its copyright law by replacing a compulsory licence with the need for specific authorization for each use. It is perhaps better characterized as a copyright infringement admission list, however, since for each use of the work, the record label openly admits that it has not obtained copyright permission and not paid any royalty or fee.

Over the years, the size of the pending list has grown dramatically, now containing over 300,000 songs. From Beyonce to Bruce Springsteen, the artists waiting for payment are far from obscure, as thousands of Canadian and foreign artists have seen their copyrights used without permission and payment.

And yet, amazingly, the record labels -- these "strong defenders" of the importance of copyright and paying for every use -- somehow have decided that it makes no sense to pay this bill. The list itself details about $50 million in unpaid royalties that are owed, often to well known musicians who it would be quite easy for the industry to find and pay up. As for the $6 billion number? Well, the class action lawsuit that's been filed seeks statutory damages starting at $20,000 per infringement and going up from there. Given that these same record labels have been defending those same (or, similar, in the US, at least) statutory rates for infringement, you have to wonder how they can realistically claim that those statutory rates shouldn't apply to themselves as well.

Once again, though, we're seeing what's really happening. The record labels are copyright defenders only when they profit unfairly from it. When they can screw over others via ignoring copyright, they have no problem doing so.